Activity wise sampling details

Sr. No. Area Count for the audit No. of samples Percentage of
period (total number of checked samples
demat request and checked
remat request
confirmed / rejected,
etc.)
1 Demat Confirmation {number of
samples checked must include
transposition cum demat and
transmission cum demat cases}
(atleast 25%)
2 Demat Rejection (atleast 25%)
3 Remat Confirmation (atleast 25%)

4 Remat Rejection (atleast 25%)

5 Investor Grievances received in
respect of depository operations
received by RTA / Issuer (100%)

6 Reconciliation (atleast 50 ISINs) for

15 different dates spread over a half
year.
25% active ISINs or 100 ISINs
whichever is higher wherein 70%
sample ISINs will be listed and
other unlisted. In case if it is below
the minimum prescribed samples, it
should be 100%.
7 Transfer and Transmission of locked
in securities & of securities where
ISIN is suspended (atleast 25%)

8 Redemption
9 Activity wise sampling details
only applicable for RTAs
servicing Mutual Funds

9.1 Conversion Confirmation {number

of samples checked must include
transmission cum demat cases}
(atleast 25%)
9.2 Conversion Rejection (atleast 25%)

9.3 Reconversion Confirmation (atleast

25%)
9.4 Reconversion Rejection (atleast
25%)
9.5 Redemption/Repurchase
 Checklist
Sr. No. Audit Areas Auditor's Observation Auditor's Management's
Remarks Comment*
1 Demat / Remat / Conversion /
Reconversion / Redemption
/Repurchase Requests Processing

1.1 Whether there is a proper procedure □ Yes □ No If no,

in place for inward of requests discrepancies
received from Participants? must be
mentioned here
1.2 Whether adequate controls exists □ Yes □ No □ Not If no,
over requests received and their Applicable discrepancies
respective status? must be
mentioned here
1.3 Whether serial number and stamp of □ Yes □ No □ Not If no,
date of receipt has been affixed on Applicable discrepancies
all the requests received by the must be
RTA/Issuer connected to NSDL? mentioned here

1.4 Whether all the requests received □ Yes □ No □ Not If no, then
during the audit period have been Applicable number of cases
processed within the stipulated time with discrepancies
frame? must be
mentioned here

1.5 Whether date of receipt mentioned □ Yes □ No □ Not If no, then

on the requests matches with the Applicable number of cases
receipt date entered in the NSDL with discrepancies
system? must be
mentioned here

1.6 Whether request forms received □ Yes □ No □ Not If no, then

were duly authorised by the Applicable number of cases
Participant and were completely with discrepancies
filled? must be
mentioned here

2 Demat Request Confirmation

2.1 While processing demat request, □ Yes □ No □ Not If no, then
whether the validity of the physical Applicable number of cases
security certificate(s) is verified? with discrepancies
must be
mentioned here
2.2 While processing demat request, □ Yes □ No □ Not If no, then
whether the RTA/Issuer connected Applicable number of cases
to NSDL verifies whether the with discrepancies
application for demat has been made must be
by the person(s) whose name is mentioned here
recorded in the Register of member?

2.3 Whether register of member (ROM) □ Yes □ No If no, then

is updated before confirmation of number of cases
demat requests? with discrepancies
must be
mentioned here

2.4 Whether RTA/Issuer connected to □ Yes □ No If no, then

NSDL transfers the registered number of cases
ownership of securities to the name with discrepancies
of National Securities Depository must be
Limited when the demat requests are mentioned here
processed?

2.5 While processing demat request, □ Yes □ No □ Not If no, then

whether the RTA/Issuer connected Applicable number of cases
to NSDL verifies the details with discrepancies
mentioned in the DRF and as must be
appearing on the physical security mentioned here
certificate(s) with the details
received electronically?
2.6 While processing demat request, □ Yes □ No □ Not If no, then
whether the RTA verifies the Applicable number of cases
signature of the applicant(s) with the with discrepancies
signature as available in record of must be
the RTA/Issuer connected to mentioned here
NSDL?
2.7 Whether Certificates received with □ Yes □ No If no, then
requests were marked with words number of cases
"Surrendered for Dematerialisation", with discrepancies
two parallel lines across the must be
certificate, two holes punched on the mentioned here
company name in the prescribed
manner, DP ID and client ID
mentioned on the certificate?

2.8 Whether only those securities have □ Yes □ No If no, then

been dematerialised by RTA/Issuer number of cases
connected to NSDL for which with discrepancies
listing approval has been received must be
from the relevant stock exchange(s)? mentioned here
 2.9 Whether Issuer/RTA has accepted □ Yes □ No □ Not If no, then
the demat request, wherein physical Applicable number of cases
security certificate(s) have got lost with discrepancies
in transit, and carried out the must be
dematerialisation on the basis of mentioned here
indemnity and proof of dispatch
furnished by the Participant as per
prescribed guidelines?

2.10. Whether any requests have been □ Yes □ No □ Not

confirmed where there exists any Applicable
prohibitory order, stop transfer,
attachment order, or disputed title on
the said securities?

2.11 If reply to 2.10 above is yes,

mention the number of cases along
with details of the matter.
3 Demat Request Rejection
3.1 Whether rejection memos have been □ Yes □ No □ Not If no, then
sent in all cases of rejections within Applicable number of cases
five days of rejection? with discrepancies
must be
mentioned here

3.2 Whether rejection memo contains □ Yes □ No □ Not If no, then

DP ID, client ID, rejection code and Applicable number of cases
rejection reason? with discrepancies
must be
mentioned here

3.3 Whether rejection code and rejection □ Yes □ No □ Not If no, then
reason as mentioned in the rejection Applicable number of cases
memo matches with that captured in with discrepancies
the NSDL system? must be
mentioned here

3.4 Whether the rejection code and □ Yes □ No □ Not If no, then
rejection reason selected by Applicable number of cases
RTA/Issuer connected to NSDL for with discrepancies
rejecting the request were correct? must be
mentioned here

3.5 Whether certificates and physical □ Yes □ No □ Not If no, then

documents are sent to the concerned Applicable number of cases
Participant within 5 days of rejection with discrepancies
of demat request? must be
mentioned here
3.6 Whether proof of despatch for □ Yes □ No □ Not If no, then
request rejections has been properly Applicable number of cases
maintained by the RTA/Issuer with discrepancies
connected to NSDL? must be
mentioned here

3.7 Whether rejection memos have been □ Yes □ No □ Not If no, then
sent only after rejecting the requests Applicable number of cases
in NSDL system? with discrepancies
must be
mentioned here

4 Conversion Request Confirmation

4.1 While processing conversion □ Yes □ No □ Not If no, then

request, whether the RTA/Issuer Applicable number of cases
connected to NSDL verifies the with discrepancies
details mentioned in the CRF with must be
that recorded on the SOA and with mentioned here
details as received electronically?

4.2 Whether any requests have been □ Yes □ No □ Not

confirmed where there exists any Applicable
prohibitory order, stop transfer,
attachment order, or disputed title on
the said mutual fund (MF) units?

4.3 If reply to 4.2 above is yes, mention

the number of cases along with
details of the matter.
5 Conversion Request Rejection

5.1 Whether rejection memos along with □ Yes □ No □ Not If no, then
SOA have been sent in all cases of Applicable number of cases
rejections and proof of dispatch with discrepancies
maintained? must be
mentioned here

5.2 Whether rejection code and rejection □ Yes □ No □ Not If no, then
reason as mentioned in the rejection Applicable number of cases
memo matches with that captured in with discrepancies
the NSDL system? must be
mentioned here

5.3 Whether the rejection code and □ Yes □ No □ Not If no, then
rejection reason selected by Applicable number of cases
RTA/Issuer connected to NSDL for with discrepancies
rejecting the request, was correct? must be
mentioned here
 6 Remat Request Confirmation
6.1 Whether RTA/Issuer connected to □ Yes □ No □ Not If no, then
NSDL transfers the registered Applicable number of cases
ownership of securities from the with discrepancies
name of National Securities must be
Depository Limited to the name of mentioned here
the BO when the remat requests are
processed?

6.2 Whether certificates are sent within □ Yes □ No □ Not If no, then
period of 30 days from the date of Applicable number of cases
receipt of remat request? with discrepancies
must be
mentioned here

6.3 Whether proof of delivery for □ Yes □ No If no, then

despatch of physical certificates has number of cases
been properly maintained by with discrepancies
RTA/Issuer connected to NSDL? must be
mentioned here

7 Remat Rejection
7.1 Whether rejection memos have been □ Yes □ No □ Not If no, then
sent in all cases of rejections within Applicable number of cases
five days of rejection? with discrepancies
must be
mentioned here

7.2 Whether rejection memo contains □ Yes □ No □ Not If no, then

DP ID, client ID, rejection code and Applicable number of cases
rejection reason? with discrepancies
must be
mentioned here

7.3 Whether rejection code and rejection □ Yes □ No □ Not If no, then
reason as mentioned in the rejection Applicable number of cases
memo matches with that captured in with discrepancies
the NSDL system? must be
mentioned here

7.4 Whether the rejection code and □ Yes □ No □ Not If no, then
rejection reason selected by Applicable number of cases
RTA/Issuer connected to NSDL for with discrepancies
rejecting the request were correct? must be
mentioned here
 7.5 Whether proof of despatch for □ Yes □ No □ Not If no, then
request rejections has been properly Applicable number of cases
maintained by the RTA/Issuer with discrepancies
connected to NSDL? must be
mentioned here

7.6 Whether rejection memos have been □ Yes □ No □ Not If no, then
sent only after rejecting the requests Applicable number of cases
in NSDL system? with discrepancies
must be
mentioned here

8 Reconversion/Redemption/Repurc
hase Request Confirmation

8.1 Whether units at the time of □ Yes □ No □ Not If no, then

reconversion have been issued to the Applicable number of cases
persons as per the pattern of with discrepancies
holdings in the account of the must be
Participant from which such units mentioned here
are reconverted?
9 Reconversion Request
Rejection/Redemption/Repurchas
e rejection
9.1 Whether rejection memos have been □ Yes □ No □ Not If no, then
sent in all cases of rejections? Applicable number of cases
with discrepancies
must be
mentioned here

9.2 Whether rejection code and rejection □ Yes □ No □ Not If no, then
reason as mentioned in the rejection Applicable number of cases
memo matches with that captured in with discrepancies
the NSDL system? must be
mentioned here

9.3 Whether the rejection code and □ Yes □ No □ Not If no, then
rejection reason selected by Applicable number of cases
RTA/Issuer connected to NSDL for with discrepancies
rejecting the request was correct? must be
mentioned here

10 IPO/Corporate Actions
10.1 Whether Corporate Actions □ Yes □ No □ Not If no, then details
processed during the audit period Applicable of discrepancies
have been carried out properly? must be
mentioned here
10.2 Whether in case of securities listed □ Yes □ No □ Not If no, then details
on stock exchanges, electronic Applicable of discrepancies
payment modes approved by RBI must be
such as ECS, NEFT etc. are being mentioned here
used to make cash payment to
investors in their bank accounts
taken directly from their demat
accounts?

10.3 Whether in case where either the □ Yes □ No □ Not If no, then details
bank details such as MICR, IFSC Applicable of discrepancies
etc. that are required for making must be
electronic payment are not available mentioned here
or the electronic payment
instructions have failed or have been
rejected by the bank, cash payments
made through physical payment
instruments for distribution of cash
benefits have the bank account
details taken directly from demat
accounts of investors printed on
such instruments?

10.4 Whether any unclaimed shares (i.e., □ Yes □ No If no, then

shares which could not be allotted to number of cases
the rightful shareholder due to with discrepancies
insufficient/incorrect information or must be
any other reason) have been credited mentioned here
to suspense account?

10.5 Whether details of shareholding of □ Yes □ No If no, then

each allottee whose shares have number of cases
been credited to suspense account is with discrepancies
properly maintained by the Issuer? must be
mentioned here

10.6 In case if the RTA/Issuer connected □ Yes □ No If no, then

to NSDL has transferred any shares number of cases
out of the said suspense account with discrepancies
during the audit period, whether the must be
same was as per the stipulated mentioned here
procedure?

10.7 Whether in case of redemptions, □ Yes □ No If no, then

RTA/Issuer connected to NSDL has number of cases
made payment towards repurchase / with discrepancies
redemption to the clients? must be
mentioned here
 10.8 Whether RTA/Issuer connected to □ Yes □ No If no, then
NSDL verifies name of the number of cases
investor(s) as appearing on the Issue with discrepancies
Application Form with that as must be
obtained from NSDL? mentioned here

10.9 Whether the name of National □ Yes □ No If no, then details

Securities Depository Limited of discrepancies
(NSDL) is recorded as "Registered must be
owner of Securities" in the Register mentioned here
of Members for securities allotted in
electronic form in NSDL?

10.10 Whether for locations where facility □ Yes □ No □ Not If no, then details
of ECS is available, bank details of Applicable of discrepancies
applicants have been taken directly must be
from demat accounts of the mentioned here
applicants in respect of refund in
public / rights issues made
completely in demat form?

11 Reconciliation
11.1 Whether separate folios for NSDL □ Yes □ No
& CDSL are maintained in
backoffice?
11.2 What is the mechanism of carrying □ Manual □ Back office
out daily reconciliation?
11.3 Whether reconciliation between □ Yes □ No
NSDL control position and Register
of Members is carried out on a daily
basis by RTA/Issuer connected to
NSDL as per SEBI/NSDL
guidelines?
11.4 If reply to 11.3 above is no, then
mention the frequency at which
reconciliation is being carried out.

11.5 Whether reconciliation mismatch □ Yes □ No

was observed?
11.6 If reply to 11.5 above is yes, □ Yes □ No □ Not If no, then
whether RTA / Issuer connected to Applicable number of cases
NSDL has sent any mismatch report with discrepancies
to NSDL? must be
mentioned here
11.7 Whether RTA/Issuer connected to □ Yes □ No If no, then
NSDL is maintaining a register for number of cases
recording the reconciliation figures? with discrepancies
must be
mentioned here

11.8 Whether the back office records are □ Yes □ No If no, then
reconciled with the NSDL records number of cases
for pending remat? with discrepancies
must be
mentioned here

11.9 Whether arithmetic sum of shares in □ Yes □ No If no, then

NSDL system, in CDSL system and number of cases
shares held in physical form is equal with discrepancies
to the total issued capital of the must be
company? mentioned here

12 INVESTOR GRIEVANCES
12.1 Whether there is any system to □ Yes □ No If no, then details
record & redress all grievances of of discrepancies
clients? must be
mentioned here

12.2 Whether grievance received from □ Yes □ No □ Not If no, then details
Beneficial Owner directly is also Applicable of discrepancies
reported in grievance report must be
submitted to NSDL? mentioned here

12.3 Whether quarterly investor □ Yes □ No If no, then details

grievance reports have been of discrepancies
submitted to NSDL as per SEBI / must be
NSDL guidelines within stipulated mentioned here
timelines?
13 Record Maintenance
13.1 Whether system is in place for safe □ Yes □ No If no, then
keeping of Demat / remat / number of cases
conversion / reconversion requests with discrepancies
including rejected requests with all must be
supporting/relevant documents for a mentioned here
period of 5 years?

13.2 Whether all documents related to □ Yes □ No If no,

Corporate Actions are maintained? discrepancies
must be
mentioned here
13.3 Whether RTA has a process to □ Yes □ No If no,
maintain a record of the destroyed discrepancies
certificates? must be
mentioned here
 14 Status of compliance for deviations / observations noted in last NSDL inspection and internal /
14.1 Whether RTA/Issuer connected to □ Yes □ No □ Not If no, then details
NSDL has complied with all the Applicable of the non
deviations noted during last NSDL compliance must
inspection? be mentioned here

14.2 Whether RTA/Issuer connected to □ Yes □ No □ Not

NSDL has taken adequate Applicable
preventive measures in respect of
deviations noted during last NSDL
inspection?
14.3 Whether RTA / Issuer connected to □ Yes □ No □ Not If no, then details
NSDL has taken adequate Applicable of the non
preventive and corrective measures compliance must
in respect of deviations noted during be mentioned here
last internal audit?

14.4 Whether NSDL has sought any □ Yes □ No If yes, then

specific comment from auditor with provide details /
respect to any issue? comments on
issues
14.5 Whether NSDL has sought any □ Yes □ No If yes, provide
specific certification from auditor details along with
with respect to any issue? supporting
documents
15 Reporting by RTA/Issuer
connected to NSDL to its Board of
Directors
15.1 Whether RTA/ Issuer connected to □ Yes □ No □ Not If yes, then
NSDL has placed last inspection Applicable mention the date
findings alongwith management of the Board
comment before its Board of Meeting
Directors? (same may be verified
from the extract of the minutes of
the Board Meeting)

15.2 Whether RTA/Issuer connected to □ Yes □ No □ Not If yes, then

NSDL has placed last internal audit Applicable mention the date
findings alongwith management of the Board
comment before its Board of Meeting
Directors? (same may be verified
from the extract of the minutes of
the Board Meeting)

16 Miscellaneous
16.1 Whether change in office address □ Yes □ No □ Not If no, then details
(Registered / Corporate) and / or Applicable of discrepancies
investor relations officer / must be
Compliance officer / contact details mentioned here
of RTA / Issuer connected to NSDL
has been communicated to NSDL as
per prescribed guideliens?

16.2 Whether RTA is updating □ Yes □ No □ Not

Distinctive Number (DN) Applicable
information in respect of all physical
share capital and overall DN range
for dematerialised share capital for
all listed companies in the manner
prescribed by SEBI?

16.3 Whether common agency □ Yes □ No If no, then

requirement as prescribed by SEBI number of cases
is being adhered to with respect to with discrepancies
all the companies handled by the must be
RTA? mentioned here

16.4 Whether Issuer connected to NSDL □ Yes □ No □ Not If no, then

/ RTA has processed requests for Applicable number of cases
transfer of locked-in securities or with discrepancies
securities held under suspended must be
ISIN in case of account closure mentioned here.
(inter-depository) and transmission
(intra depository and inter-
depository) as per prescribed
guidelines?

16.5 Whether Issuer connected to NSDL □ Yes □ No □ Not If no, then

/ RTA has obtained requisite details Applicable number of cases
of Promoters/ Promoter Group from with discrepancies
the listed Issuers and uploaded the must be
same in the prescribed format on the mentioned here
NSDL system?

16.6 Whether the Issuer connected to □ Yes □ No □ Not If no, then

NSDL / RTA, in case of any change Applicable number of cases
in Promoters / Promoter Group (i.e. with discrepancies
for Addition, Modification or must be
Deletion), obtained the approval of mentioned here
the stock exchange(s) on which the
securities of company is / are listed
and thereafter updated the same in
NSDL system?
 16.7 Whether depository operations □ Yes □ No □ Not If no, details of
handled by RTA / Issuer connected Applicable discrepancies
to NSDL are in accordance with must be
SEBI/ NSDL guidelines? mentioned here

16.8 Whether the Issuer having □ Yes □ No □ Not If no, details of

connectivity with NSDL and Applicable discrepancies
handling registry operations in- must be
house, has not exceeded limit of one mentioned here
lac share holders?
16.9 If reply to 16.8 above is yes, □ Yes □ No □ Not If no, details of
whether procedure for registration as Applicable discrepancies
Share Transfer Agent has been must be
initiated with SEBI? mentioned here

16.10. Whether all associated persons □ Yes □ No If no, details of

engaged in depository operations are discrepancies
NISM certified as per SEBI/NSDL must be
guidelines? mentioned here
16.11 Whether any other deviation/non-
If Yes, then
complaince observed by internal
□ Yes □ No details must be
auditor which is not specifically
mentioned here
covered above?
17 System Areas
17.1 Whether adequate physical and □ Yes □ No If no, then
logical access restrictions for usage number of cases
of system are in place? with discrepancies
must be
mentioned here

17.2 Whether scheme of variable access □ Yes □ No If no, then details

rights is implemented? of the issue must
be mentioned here

17.3 Whether NSDL system is used only □ Yes □ No If no, then details
for the depository operations and no of the issue must
other software or alteration of be mentioned here
parameters / configuration has been
made?

17.4 Whether Antivirus software in the □ Yes □ No If no, then details

client machine is updated as per of the issue must
prescribed frequency? be mentioned here

17.5 Whether all the softwares installed □ Yes □ No If no, then details
on client machine are licensed? of the issue must
be mentioned here
 17.6 Whether documentation relating to □ Yes □ No If no, then details
procedure for internet and etoken of the issue must
has been maintained? be mentioned here

17.7 Whether hardware and operating □ Yes □ No If no, then details

system on machines used for of the issue must
depository operations are as per the be mentioned here
specifications mentioned in the
latest Form B submitted to NSDL?

17.8 Whether scheduled switch to □ Yes □ No If no, then details

fallback connectivity is done and the of the issue must
record thereof is maintained? be mentioned here

17.9 Whether all the hardware / □ Yes □ No If no, then details

equipments used for depository of the issue must
operations are covered under AMC / be mentioned here
warranty?
17.10. Whether backup of back office data □ Yes □ No If no, then details
is taken? of the issue must
be mentioned here

Important References (only illustrative, not exhaustive) -

1 NSDL Bye laws and Business Rules
2 Compliance Manual
2 Other circulars issued by NSDL and SEBI from time to time
Management's Comment* - Mandatory if auditor's observation is negative.